The latest ABS home lending data for the June 2026 quarter presents a sweet and sour view of the housing market nationally and for NSW.

Nationally, there was a 6.4% fall in the number of loans for the acquisition of homes (new and existing) driven by a reduction in investor loan activity of 11.4%. 

In NSW the decline was greater, with the number of loans for acquisition of homes (new and existing) falling by 9.2% from 39,272 in the March 2026 quarter to 35, 274 in the June quarter.  The drop was also mostly driven by the reduction in investor activity. 

Sweet and sour results in NSW 

The number of loans for the construction of a new home rose by 2.4% in the June 2026 quarter. It’s good news that more people who already own land are borrowing money to build a detached dwelling on it. 

But there are signs that dark clouds are forming.

A 9.8% reduction in the number of loans to buy newly built dwellings, which mostly means new apartments and house and land packages is bad news and the June quarter data does not show the full impact of the Albanese Government’s increase in the rate of Capital Gains Tax (CGT).

While the effects of the CGT increase will be more obvious in the September quarter data, economists believe that the Albanese Government's changes to property taxation is already having a negative effect on the sentiment of housing investors who in NSW account for: 

• 54.3% of loans for construction of new homes.
• 40.6% of loans for purchase of newly constructed homes.
• 50.8% of loans for buying residential land.

Another risk for home builders could come from a further decline in home prices. The major banks including the Commonwealth, Westpac and the NAB are forecasting further flattening of house prices over the next year, and commentators are suggesting the increase in CGT will continue to discourage property investors. If this happens then more first home buyers may sense an opportunity to make their first home an established property, reducing demand for newly built houses and apartments.

Resilience in renovation sector

The relative resilience of the renovation sector over the March and June quarters is positive. The number of new loans for alterations and additions not only held up for both owner occupiers and investors in the June and March quarters but so far is performing more strongly than over the previous 12 months from June 2025.

ABS data - National loans for housing activity

ABS data - NSW loans for housing